3 reasons to give Best Buy another chance

Consumers are turning their backs on Best Buy stores, but are they acting too rashly?

On Tuesday, Best Buy Co.
BBY, +0.74%
released its second-quarter earnings and while they beat analysts’ expectations, the news wasn’t all good. As compared to last year, net income was down 41% and total revenue fell 3.2% from last year. Plus, shares are down about 20% since early 2014 and same-store sales fell 2.7% for the quarter.

“Like other retailers and as reflected in this quarter’s performance, we continued to see a shift in consumer behavior: consumers are increasingly researching and buying online,” Chief Executive Hubert Joly said in a statement.

In other words, customers are turning their backs on Best Buy stores. But here are three reasons that you shouldn’t completely write off Best Buy stores, yet.

Good deals on some items. While Best Buy, of course, doesn’t have the lowest asking prices on all items, there are some arenas in which is often does. Matthew Ong, a senior retail analyst at NerdWallet.com, says that its best deals tend to be on the doorbuster-style deals on things like TVs and laptops that it advertises in its weekly circulars (so check there before hitting the store), and Andrea Woroch, a consumer savings expert at Kinoli, says that the retailer tends to have good deals on “big-ticket items like TVs.” Erin Konrad, a spokesperson for CouponPal.com says that two areas where she finds especially good deals are on cell phones and televisions, especially LCD and LED TVs, and Jon Lal, the CEO and founder of BeFrugal.com says large appliances like washers, dryers and refrigerators are often priced low. And Woroch says that there can be good deals on items that have been previously opened — often these are items people return after opening — or display items.

Bottom line? Of course, it pays to shop around, but Best Buy doesn’t usually gouge consumers on the asking prices of big-ticket items like refrigerators, washing machines, laptops and tablets, says Konrad; furthermore, it sometimes offers bargain prices on get-you-in-the-door items.

Price-matching policy. Best Buy has a number of consumer-friendly policies, one being a low-price guarantee or a price-matching policy, which many other stores, especially smaller stores, don’t have. “Best buy has a great price match policy,” says Woroch.

Here’s how it works: At the time of the sale, consumers can show the Best Buy customer service rep an ad or web address with a lower listed price for an identical item, and then the retailer will match the price of an identical item from a local retailer (those within a 25 mile radius; this includes their online prices) and from a major online retailer like Amazon.com, Bhphotovideo.com, Crutchfield.com, Dell.com, HP.com, Newegg.com, and TigerDirect.com, as well as from its own website BestBuy.com (you have to call customer service to get the deal in this case). “The price match is pretty easy to do at Best Buy,” says Ong, who adds that it’s often as simple as pulling up the competitor’s price on your smartphone and showing it to the person working the register (who then likely gets management to approve it).

Price-adjustment policy. If Best Buy puts an item you bought on sale within about 14 or 15 days of your purchase (that can vary, depending on what the specified return period is for your item), you can get a one-time price adjustment on that item, which means you end up essentially paying the lower price.

Still, there are plenty of valid reasons that consumers are turning away from Best Buy. Here are three.

Not-so-great-deals on some items. Woroch says that there are certain items that consumers should avoid buying at Best Buy such as gadget accessories like HDMI cables, headphones, camera memory cards and phone or tablet cases, which “aren’t typically discounted as the retailer knows most shoppers walking out with a good deal on a new tablet or TV will need to purchase the extras,” she says. Sometimes, “you can expect to pay a 40 to 60 % markup on extras,” she adds. Woroch adds that, in general, extended warranties are a bad deal. “Most gadgets and electronics you purchase these days have a rapid depreciation value so it may cost less to replace then fix or cover,” she says. Instead of purchasing the warranty, consider using “a credit card with a protection policy which typically doubles the manufacturer warranty for free,” she adds.

Price-match and adjustment limitations. There are limitations to the price-match policy— though these tend to be fairly standard — including the fact that Best Buy will not price match: financing, coupon, mail-in and bundle offers; pricing errors; items that are advertised as limited quantity; clearance or refurbished/used items; and many daily deals and Black Friday offers.

In other words, it will price match the everyday prices on many items, but not on special offers in many cases, so if you find an item on clearance or special offer at another retailer — which is often the case — buy it there. Plus, the price adjustment policy may be annoying to take advantage of because you need to shop at Best Buy again to see if there is a lower price.

Below-average service. The American Customer Service Index, which surveyed more than 11,500 customers, found that Best Buy’s customer satisfaction ranking was below average for speciality retail stores, with a score of 77 out of 100, compared to the average of 80 out of 100. So while it’s sometimes nice to go into a store to buy items, you’re likely to be more satisfied with your experience at Costco
COST, +0.30%
(84), OfficeMax
ODP, +0.59%
(82), Staples (81) and Sam’s Club
WMT, +0.63%
(80) — all of which sell electronics and got higher scores than Best Buy on the ACSI.

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